Dior, Loewe and Hermès turn upside down Paris fashion week to avoid gilet jaunes, who are deeply affecting sales as well

The gilet jaunes keep affecting French daily life and habits. Turmoil and protests aroused by “yellow sleeveless jackets” have been recently forcing French designers and brands to modify the agenda of Men’s Paris Fashion Week: in fact, Dior have brought forward their first fashion show, by Kim Jones, moving it from Saturday 19 to Friday 18 (venue has not been made public); likewise, Loewe and Hermès have been acting alike, while suspending their shows and putting them off to a future date to be set. Consequences will not hit the brands just in terms of advertising, but also in terms of revenues and business, following the heavy financial decrease of the past weeks, during Christmas holidays. In France, as much as in the rest of the world, at this time of the year they usually achieve around 30% of yearly sales: yet, unfortunately, demonstrations and rallies organized by gilet jaunes urged most French consumers to give up shopping. On the other hand, fashion brands, major groups including Kering among others, decided to keep their stores closed, for precaution, both on Christmas weekend and at the sales kick-off one. As reported by Le Figaro, 2018 ending period has been one of the worst ever for apparel; throughout the sales weeks, prices of goods are bound to decrease considerably to enable brands and manufacturers to clear out all remarkable stocks and provisions that have been unsold. Looking at some forecast, revenues will supposedly drop by 4 to 6%, or even 7% for some players, according to a few independent agencies, whereas the Institut Français de la Mode (the French Fashion Institute) expects earnings to decline by 2,7% in the next eleven months. We were telling you, a few days ago, about predictions set by the Alliance du Commerce (department stores and apparel/footwear): they expect the overall turnover to drop by 25 to 35%. How about online sales? Despite their positive trend and performances and a successful Black Friday, in November, accomplishments achieved by e-commerce are seemingly unable to offset the business slowdown of in-store sales. Eric Mertz, president of the national Federation of apparel, while speaking to the French daily newspaper, claimed that “2018 will drive us back to a gigantic downfall, which reminds of 2009, at the beginning of recession”. The government is struggling hard to face and tackle the situation, which scares the major groups, who pay close attention, meanwhile, to the amendments to financial decrees set by French President. Allegedly, Bernard Arnault is even thinking of taking Christian Dior out of the financial markets. The news has been reported by Reuters press agency. Such is supposedly the plan of France’s richest man to successfully complete his takeover: last year Arnault owned 94,2% of Dior shares, very close, then, to 95%, which is the amount he needs to claim his option to buy stocks left after promoting a total takeover bid, the so-called “squeeze out”. Although the French government still has not approved some new financial laws, which aim to make France more appealing to foreign investors, according to Reuters the French tycoon might act prior to their approval: in fact, over the last months Arnault has successfully carried out some more acquisitions, and today he supposedly owns 96,5% of Dior shares. That is, much more than necessary for the brand de-listing.


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